The Port of Los Angeles with containers, ships and trucks is shown on Wednesday afternoon, Oct. 13, 2021. President Joe Biden announced a deal to expand operations at the Port of Los Angeles in hopes of ending the logjam of ships waiting to unload. The supply chain squeeze has caused climbing prices and delays in delivery that are threatening the U.S. economy and holiday shopping. (Dean Musgrove/The Orange County Register via AP) Dean Musgrove/AP
Los Angeles ports are buried under 40-foot shipping containers, but across the sea, Chinese businesses are begging for them.
As the ubiquitous steel boxes clog the ports, local streets, and seemingly any unused lot around the coast, both California Gov. Gavin Newsom and Long Beach Mayor Robert Garcia have jumped into action alleviating red tape that had curtailed storage options.
Late Friday, Garcia waived an ordinance that prohibited stacking containers more than two high. Now the limit is four — or five with special approval. Also last week, Newsom ordered the state to search for government or privately owned parcels to lease for additional storage.
RECORD 100 SHIPS WAITING OFFSHORE AT LA PORTS
“A year ago, you would just do a transaction, bring an empty in and get a load out on the same chassis,” said a trucker named Brian. “Now [ports] are not accepting any empties because they are not going back on the ships. We’re told the ships cannot make money on the empties.”
Meanwhile, in China, bicycle maker Derrick Tian spent weeks searching for a container to export his products to United States stores in time for Black Friday and Christmas. His small business has been crippled by COVID-19 lockdowns, and now he fears that a long list of orders will be jeopardized by a container shortage.
“The biggest problem is to get your goods out of China,” Tian told the South China Morning Post.
The lack of containers in China creates another problem: skyrocketing shipping costs that are eventually passed on to the consumer.
Walmart containers are stacked in a lot near Los Angeles harbor Tori Richards
“We have a full-blown container crisis on our hands,” admitted freight transporter Hillebrand on its website. The company said China was the first to recover from COVID-19 and started shipping in large numbers before America had recovered. Another problem is the lack of financial incentive for shipping companies to return the containers. Carriers get 66 cents per nautical mile from Shanghai to Los Angeles but only 10 cents for a return trip, Hillebrand said.
So while China ramps up its production of new containers to meet the demand, even more of these metal boxes are headed toward Los Angeles from the South.
Up to 2,000 empties from cities such as Charleston, Savannah, and Houston are en route to Southern California, American Shipper is reporting. It’s unclear when the cargo will arrive or where the containers will find a home.
On Friday, the Washington Examiner found areas around the Los Angeles port filled with containers, spilling out into neighborhoods. Police have issued more than 400 citations in the past few weeks for illegally parking the boxes — some left on the ground and others still on chassis unhooked from the trucks. It’s cheaper just to abandon the load rather than pay storage fees, truckers say.
Cargo containers abandoned on a chassis sit along a busy Los Angeles street. Tori Richards
On one commercial street, containers spilled out of the yard and were parked two deep next to a curb. The street dead-ends 100 feet away and the entire area was filled with containers.
“It’s never been this bad, just during the past year,” said Joe Healey, who works at a nearby seafood supply company.
For trucker Brian, the solution is simple.
“Why not take two ships back full of empties and you would have 40,000 containers going back?” he said. “Do we want to squeeze out mom and pop businesses on both sides of the ocean or do we want to send the containers back to China?”